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Oil Settles Above $40, U.S. Crude Clings to Weekly Gain By Investing.com

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By Barani Krishnan

Investing.com – Oil ended the week little changed as a drop in stockpiles of crude and diesel countered concerns about market direction amid surging Covid-19 caseloads.

New York-traded , the key indicator for U.S. crude prices, settled at $40.88 per barrel, up 0.7% on the week although it was down 8 cents, or 0.2%, on the day.

London-traded crude, the global benchmark for oil, was, however, down for both the day and week. 

Brent settled Friday’s trade at $42.93 per barrel, down 23 cents, or 0.5%. For the week, the global crude gauge slid 8 cents, or 0.2%. 

U.S.  tumbled 3.8 million barrels last week after rising by just over 500,000 barrels the previous week, the Energy Information Administration said Thursday.

The EIA also reported that plunged by 7.2 million barrels for the week ended Oct. 9 versus a slide of just 962,000 in the week to Oct. 2.

Global oil inventories, which ballooned in the second quarter as fuel demand collapsed, are currently falling at a clip of around 3 million barrels a day, Gunvor chief executive Torbjorn Tornqvist told Bloomberg in an interview published on Thursday.  U.S. inventories have fallen in all but two of the last 12 weeks, and last week’s declines were considerably sharper than expected.

But while the drawdowns looked good for supply-demand optics, there were also concerns they could be distorted by precautionary reactions related to the shutdowns forced by Hurricane Delta, which struck Louisiana on Monday as a Category 2 storm.  Nearly 92% of all oil production in the U.S. Gulf of Mexico was shuttered by Delta. With most of those facilities having reopened since, output and stockpiles could rise again in coming weeks.

This week’s global spike in Covid-19 caseloads has also raised alarm across markets. Infections in Italy again moved near the danger zone last seen in March, while the U.K. and France imposed new movement restrictions. In the United States, new cases are up in 39 of the 50 U.S. states.

Reuters reported that the OPEC+ bloc of producers – whose technical experts met in Vienna on Thursday to discuss the state of the global oil market – fear that a fresh wave of the pandemic will hit demand and end the slow process of rebalancing that has been in progress since the summer. 

The intention of the OPEC+ bloc, which includes producers such as Russia, is to start raising output again as inventories approach their historical norms. Their current deal on output restraint foresees them raising production by nearly two million barrels a day at the start of next year, on the assumption that inventories continue to fall. 

Reuters noted that it’s only the worst-case scenario considered by OPEC+’s experts on Thursday that supply/demand could return to a surplus. Even so, that’s gloomier than any of the scenario entertained by the bloc a month earlier. 

Another factor complicating the supply picture is the return of Libyan production after months of disruption from civil war. The north African country, which is an OPEC member but which isn’t covered by the output restraint deal, is now producing some 500,000 barrels a day and some forecasts say it could rise to 700,000 b/d or more by year end.

— With additional reporting by Geoffrey Smith

 





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Commodities

Trading Theory—Adding To Winning Trades – Growing Your Money

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Trading Theory—Adding To Winning Trades

When Do You Add To Your Winning Trade? This has always been a very interesting question because it can create a situation of going from rags to riches to riches to rags in a very short amount of time.

Many times I see traders abuse pyramiding or adding to positions with utter lack of any type of money management system in place and letting it ride which usually ends up in a complete wipeout of capital and sometimes even worse.

Commodity prices can move very quickly with large gains or loses like we experienced in 2008 crash of stock and commodity prices, so you always have to use stops and not fall in love or marry a position.

My answer to this question is add only once to the trade if that position has made you at least 1%-2% of your account balance while still having stop losses on all positions that equal 2% loss at a maximum risk.Remember your stop loses will be different on both positions because of the fact that you entered those trades at a different date and price.

 

 

 

If you are looking to contact Michael Seery (CTA—COMMODITY TRADING ADVISOR) at 1-630-408-3325 I will be more than happy to help you with your trading or visit www.seeryfutures.com

 

FREE TRIAL FOR THE LIMIT UP COMMODITY NEWSLETTER

Email: mseery@seeryfutures.com

If you’re looking to open a Trading Account click on this link www.admis.com

Disclaimer: This and other personal blog posts are not reviewed, monitored or endorsed by TalkMarkets. The content is solely the view of the author and TalkMarkets is not responsible for the content of this post in any way. Our curated content which is handpicked by our editorial team may be viewed here.



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Crude Oil Tumbles as OPEC Happy Talk Fails to Quell Demand Fears By Investing.com

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© Reuters.

By Geoffrey Smith 

Investing.com — Crude oil prices fell sharply on Monday in line with other risk assets as the rapid spread of the Covid-19 virus across Europe and the U.S. sparked fears of more demand destruction through restrictions on economic and social activity.

By 11:35 AM ET (1635 GMT), futures were down 3.1% at $38.61 a barrel, their lowest level in three weeks. The international benchmark blend was down 2.8% at $40.88 a barrel, having also hit a three-week low.

U.S. gasoline RBOB futures were down 2.5% at $1.0991 a gallon, testing their lowest in over a month. Data from GasBuddy showed that U.S. demand for gasoline fell by 0.5% last week.

Sentiment was summed up by Patrick Pouyanne, the chief executive of French oil and gas major Total, who told a conference that “globally speaking, the demand is still weak.

“I am afraid that with the second wave we are experiencing in many continents today again, it could be longer [for demand] to recover like everybody hoped,” Pouyanne was quoted by Argus Media as telling the CERA Week conference.

The pressure on the corporate sector was again in evidence, with Canada’s Cenovus and Husky Energy (OTC:) announcing plans to merge over the weekend in a bid to rationalize costs and squeeze more value out of reserves that require relatively high investment to be monetized.

However, as usual, there was no shortage of those willing to talk prices up. Saudi Arabia’s Oil Minister Prince Abdulaziz bin Salman was quoted as telling the same conference as Pouyanne that the essentially cyclical nature of the oil business was unchanged, and that low prices and low capital spending now would beget high prices in the future.

In the same vein, Indian Oil Corp. Chairman Shrikant Madhav Vaidya told S&P Global Platts in an interview that Indian product demand is now rebounding strongly after a wretched couple of months due to the virus. India has one of the world’s highest death tolls from Covid-19, after the U.S.

Likewise, OPEC Secretary General Mohammed Barkindo hinted CERA Week that the OPEC+ bloc of producers that a deferral of a scheduled increase in output at the end of the year is still possible, stressing that that the group will “adapt to the changing realities.”

“We are determined to assist the market to restore stability by ensuring that the stock drawdowns continue.”

There was little visible effect however from signs of yet another disruption to production in the Gulf of Mexico, where BHP, Chevron (NYSE:), Royal Dutch Shell (LON:) and BP (NYSE:) had all started to remove non-essential personnel from their platforms ahead of the likely arrival of Tropical Storm Zeta. The National Hurricane Center said it expected dangerous storm surges across the Yucatan peninsula in Mexico later Monday.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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OPEC chief says rising infections may delay oil recovery By Reuters

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By Alex Lawler

LONDON (Reuters) – OPEC’s secretary general said on Monday an oil market recovery may take longer than hoped as coronavirus inflections rise around the world, and OPEC and its allies would “stay the course” in balancing the market.

The Organization of the Petroleum Exporting Countries and allies including Russia made a record oil output cut in April as the pandemic hit demand. They are scheduled to increase output in January as part of a gradual easing of supply curbs.

OPEC’s Mohammad Barkindo, asked at the virtual India Energy Forum by CERAWeek if the second wave of the virus required any changes to OPEC+ strategy, said hopes earlier this year of a demand rebound had been disappointed.

“We were hopeful the second half of 2020 would begin to see a recovery,” Barkindo said. “Unfortunately, both the economic growth and demand recovery remain anaemic at the moment due largely to the virus.”

“We remain cautiously optimistic that the recovery will continue. It may take longer, maybe at lower levels, but we are determined to stay the course,” Barkindo added.

Russian President Vladimir Putin, speaking last Thursday, did not rule out extending the oil cuts for longer if market conditions warranted.

Barkindo said producers did not expect a renewed oil-price collapse as seen in the second quarter, when oil hit historic lows with briefly trading in negative territory.

OPEC+ producers had met an average of 100% of their supply cut commitments and would continue to implement the curbs so that inventories fall further, Barkindo said.

“We are determined to assist the market to restore stability by ensuring that the stock drawdowns continue.”

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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